President Trump said he approved in principle the deal under which Oracle and Walmert would receive ownership stakes in Chinese-owned app TikTok. His remarks come a day before his administration’s ban on TikTok app downloads in the U.S. is set to go into effect — which TikTok filed a last-minute suit seeking to stop.
“I have given the deal my blessing,” Trump told reporters Saturday at the White House. “If they get it done that’s great. If they don’t, that’s fine too.” He added, “I approved the deal in concept.
Trump said the new U.S.-based TikTok entity will be located “most likely in Texas.”
At this point, there is no final deal between ByteDance, the Beijing-based company that owns TikTok, and Oracle, Walmart and other U.S. investors. The deal would still need approval from the Treasury Department-led Committee on Foreign Investment in the United States, as well as Chinese authorities.
Meanwhile, TikTok late Friday filed an 11th-hour lawsuit seeking an injunction stopping the Commerce Department’s decree that TikTok (and another Chinese-owned app, WeChat) would no longer be allowed to be downloaded from app stores after 11:59 p.m. on Sunday, the Wall Street Journal reported.
In the lawsuit, TikTok alleged that the Trump administration has denied the app’s owners due process of law, and again asserted that the president took the actions “for political reasons rather than because of any ‘unusual and extraordinary threat’ to the United States.” The lawsuit Friday, filed in federal district court in Washington, D.C., makes similar arguments to TikTok’s Aug. 24 lawsuit seeking to block the Trump ban.
As a separate entity, TikTok would file for an IPO on a U.S. stock exchange within a year after majority control is transferred from ByteDance to U.S.-based interests, according to media reports. In addition, TikTok would be required to appoint a board of directors entirely comprised of U.S. citizens.
On Monday, Oracle confirmed it reached a deal to be the “trusted technology provider” in the U.S. for TikTok. Oracle is headed by chairman Larry Ellison, who is an open Trump backer. Under the partnership, Oracle would reportedly receive a 20% equity stake in the company. It’s not known what kind of stake Walmart might receive.
Another question mark still hanging over the proposed TikTok/Oracle/Walmart pact is whether TikTok, under the new U.S. ownership structure, would have access to the artificial-intelligence technology that powers TikTok’s video recommendations. Last month, China’s government adopted new export restrictions on Chinese companies governing AI technology, adding another complication to the potential TikTok deal.
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